30-Second Summary
SPX options come in two settlement flavors. PM-settled contracts (ticker SPXW) — the dailies and weeklies that 0DTE traders live in — trade until 4:00 PM ET on expiration day and settle in cash against the closing SPX value. AM-settled contracts (ticker SPX) — the traditional third-Friday monthlies — stop trading Thursday afternoon and settle against SET, a value computed from Friday’s opening prints of all 500 index components. The AM structure carries one overnight session of gap risk you cannot trade out of. If you sell same-day premium, you trade the PM contracts; the AM mechanics matter mostly so they never surprise you.
What Time Do SPX Options Expire?
PM-settled SPX options (SPXW dailies and weeklies) expire at 4:00 PM ET on expiration day, settling in cash against the official closing value of the SPX index. AM-settled third-Friday monthlies stop trading at 4:00 PM ET on Thursday and settle the next morning on SET, calculated from Friday’s opening prices.
One detail trips people up: SPX options normally trade a curtailed session until 4:15 PM ET, but a contract on its own expiration day stops at 4:00 sharp. There is no 15-minute grace window on the dying contract. Whatever the index does between 4:00 and 4:15 belongs to tomorrow’s expirations, not today’s. The full schedule is in Cboe’s SPX contract specifications .
How PM Settlement Works (SPXW Dailies and Weeklies)
PM settlement is the simple one. The contract trades all day, expires with the closing bell, and settles in cash against the closing index value the same evening. In the money by 12 points? Your account is debited or credited $1,200 per contract and the position is gone. Out of the money? It expires worthless. Nothing carries overnight.
Since Cboe extended SPXW listings to every trading day of the week, there is a PM-settled contract expiring every single session — which is precisely what makes a daily 0DTE premium-selling cycle possible. You sell the morning, manage to the close, and the slate wipes clean at 4:00. The whole risk profile of a 0DTE iron condor is built on that clean same-day boundary.
How AM Settlement Works (SET and the Third-Friday Monthly)
The original SPX monthly contract — third Friday of the month, ticker SPX rather than SPXW — settles differently, and the mechanics are worth reading twice.
The contract’s last trading session ends Thursday at 4:00 PM ET, the day before expiration. Friday morning, the settlement value is calculated — not from any traded SPX price, but from the opening price of each of the 500 component stocks, whenever each happens to open. That composite is published mid-morning under the ticker SET. Because the components open at slightly different times, SET is a synthetic print: it can land at a level the index itself never actually traded through on Friday.
So an AM-settled position spends its final night frozen. You can’t close it, you can’t hedge it with the same contract, and the number that decides your P&L doesn’t exist until the next morning’s opening rotation.
The Overnight Risk Hiding in AM Settlement
Walk through what that gap can do. Say you’re short a 5600/5625 call spread in the July monthlies and SPX closes Thursday at 5560 — a comfortable 40 points out of the money. The position looks finished. Then a hot jobs number lands at 8:30 Friday morning, S&P futures rip, and the components open strong. SET prints 5618.42.
Your short call settles 18.42 in the money: a $1,842 debit per contract, on a position that was 40 points safe when you last had the ability to touch it. Nothing malfunctioned. That is simply what AM settlement is — one mandatory overnight hold with the outcome decided by an opening rotation you can’t trade against.
PM-settled contracts have their own version of expiration-day drama (a late-day move into the close), but you can watch it and act until 4:00. The AM structure takes the steering wheel away Thursday afternoon.
Which Contracts 0DTE Traders Actually Trade
PM-settled SPXW, essentially always. A same-day seller wants the contract born and settled inside one session — that’s the whole point of the trade. The AM monthlies still matter to anyone running longer-dated SPX positions (they’re deep, liquid contracts with decades of history), but for daily premium selling they’re the wrong tool, and on the third Friday of each month it pays to double-check which listing you’re actually in. Most broker chains label them clearly; the ticker (SPX vs SPXW) is the tell that never lies.
Everything else about the two listings is identical: same underlying index, same European exercise , same cash settlement , same Section 1256 tax treatment . The settlement clock is the only fork in the road.
Frequently Asked Questions
What is the SET settlement value?
SET is the special opening quotation used to settle AM-settled SPX options. It’s computed from the opening price of each of the 500 S&P components on expiration Friday and published under the ticker SET. Because components open at different moments, SET can differ noticeably from where the index appears to open.
What time do 0DTE SPX options expire?
At 4:00 PM ET on their expiration day. 0DTE trades use PM-settled SPXW contracts, which settle in cash against the official closing SPX value. The expiring contract stops trading at 4:00 even though non-expiring SPX options continue until 4:15 PM ET.
Can I exit an AM-settled SPX position on expiration Friday?
No. AM-settled monthlies stop trading Thursday at 4:00 PM ET. From that moment the position is locked, and Friday’s SET print decides the outcome. Any hedge on Friday morning has to be built from different instruments — futures or PM-settled options.
How do I tell AM and PM contracts apart?
By root ticker: SPX is the AM-settled third-Friday monthly; SPXW is the PM-settled daily/weekly. On the third Friday of a month both exist side by side, which is exactly when checking the root symbol matters most.
Related Articles
- Cash-Settled vs Physically Settled Options — what “settles in cash” actually means mechanically, and why index sellers never touch a share.
- SPX vs SPY Options: 4 Key Structural Differences — the broader comparison: settlement, exercise style, taxes, and contract size in one place.
- 0DTE Options Trading: The Complete Guide — the strategy layer that lives entirely inside the PM-settled daily cycle.
This content is for educational purposes only. Options trading involves significant risk of loss. Always trade within your risk tolerance.